01/11/2022
What to monitor in 2022
Was 2021 a good year for the telecommunications industry? 63% of those who answered the Teleco poll expect 2022 to be better or much better. The main trends to be monitored in the year are presented below.
- Beginning of operation of 5G network
- After the 5G auction, attention turns to the beginning of operation of 5G networks.
- The advance in the coverage of these operators must follow the schedule for releasing the 3.5 GHz band, which should happen until Jun/22 for the capitals and Brasília and in municipalities with more than 500 thousand inhabitants until Jan/23.
- The 2.3 GHz band is likely to be used to anticipate this date and as a complement to the 3.5 GHz band, due to the lower availability of smartphones that support this frequency. Used alone, this band offers speeds close to 4.5G with 5G, due to having a lower bandwidth (50 MHz)).
- Vivo, Claro and TIM will compete from the beginning for the title of best 5G operator in coverage, speed and availability. They may invest in the sale of 5G handsets to increase their base of this technology.
- The new operators may start commercial operation more strongly in 2023, but it will be interesting to follow the alliances that will be made to deploy their networks.
- Despite expectations regarding the new services for the B2B market that 5G will be able to support, these applications should gradually grow. In 2022, what can be observed will be the increasing continuity in the number of pilot tests.
- The new competitive scenario with Oi Móvel sale
- The sale of Oi Móvelis likely to take place in the 1st half of 2022 and it will be important to monitor the impacts on the regional market share of Vivo, Claro and TIM, as well as the remedies to be established by Cade/Anatel to approve the transaction.
- Oi Móvel will be divided into three operators corresponding to the share that belongs to each of the buyers, who will have 18 months to incorporate it.
- New Oi, after the end of judicial recovery process
- Oi is likely to exit judicial recovery in the 1st half of 2022, after the approval granted by Cade/Anatel to the sale of Oi Móvel and V.Tal.
- It still remains to decide, together with Anatel, the destination to be given to its copper network.
- The new Oi will be a smaller company, with annual revenue of around R$ 9 billion, an EBITDA margin of between 20% and 25% and lower debt. By the end of 2022, it will be possible to have a better view of how it will perform.
- Consolidation process of fiber companies
- The consolidation process of Competitive fixed broadband providers (all except Claro, Vivo and Oi) occurs in all company sizes and is likely to continue accelerated in 2022.
- Consolidation could lead companies such as Brisanet, Alloha, Algar, Desktop, Vero and Unifique to end 2022 with more than 1 million broadband accesses.
- Competitive companies are likely to continue to lead the growth of fixed broadband accesses in Brazil and at the end of 2022, xDSL accesses, which, in Nov/21, represented 9% of total accesses, may have their share reduced to less than 5%.
- Infrastructure companies with open networks
- The infrastructure companies V.Tal, FiBrasil and FiberCo created by Oi, Vivo and TIM respectively, to enable the expansion of their fiber networks, will have their test of fire in 2022.
- These networks are open to other providers, including Competitors and mobile operators, but it is not yet clear to what extent they will be neutral from a competition point of view.
- They will have the challenge of getting Competitors to use their networks.
- Internet of Things
- The implementation of IoT solutions is growing in Brazil at a rate of 20% to 30% per year, but there is still much to be done.
- Smart cities and agribusiness have been the areas with the greatest demand and the arrival of 5G will pave the way for new applications.
- Brazil had 34 million M2M devices in Nov/21, of which 14.1 million were for IoT (growth of +30% in 1 year).
- MVNOs
- MVNOs had a significant growth in their number and number of accesses in 2021 and will continue to grow in 2022.
- They initially focused on the B2B (M2M) market but are expanding into retail.
- It will be interesting to see whether the entry into operation of new 5G mobile operators had already produced an impact on this segment in 2022.
You could ask:
- Will 2022 be a better year than 2021 for the telecommunications sector in Brazil?
- How will the coverage and number of cell phones with 5G technology advance in 2022?
- Will the competitive companies continue to lead the growth of fixed broadband in Brazil?
- What will happen to Oi in 2022?
- Will fixed telephony concessionaires migrate to the authorization regime?
